Wednesday, February 18, 2009

Instant Controversy

Starbucks has launched an instant coffee - Via. Brand pundits are saying this is another signal of the brand’s demise. Many reminisce to the days when Starbucks brewed each cup by hand using the La Marzocco. Yet, Starbucks has been using “push button” technology now for years. Why? To improve product and service quality. The La Marzoccos were tricky to calibrate resulting in an inconsistent brew and in more down time that slowed customer service. The push-button machines, while not flawless, were more consistent and faster.

Most people, no offense, make a lousy cup of coffee at home. How many coffee drinkers do you know that actually grind their beans and stick the grounds in a coffee press every morning? And how many coffee drinkers know what the correct portion or grind are, store their coffee in an airtight container and ensure their beans are no longer than seven days old?? (My parents love Starbucks coffee but I shudder when I read the date stamps – of OPEN coffee bags still in use)

People love convenience. Via will finally provide all the coffee lovers out there who don’t want to fuss with coffee brewing or who don’t feel like getting dressed in the morning to grab a Starbucks, a pretty decent cup of coffee. And as long as it does not distract management from their immediate priority - fixing the retail business - a great innovation in a very "stale" category.


  1. I agree - perhaps Starbucks has rejuvenated the instant category and that is an exciting innovation indeed! According to a recent Ad Age taste test, this instant coffee is as good as the in-store brew. If that's the case, Starbucks will have successfully added a user occasion (me, on road trips and at friends' houses if good coffee is not otherwise available) and perhaps a new customer (my mother-in-law who makes instant coffee because she "only wants one cup").

    I can't wait to try it!

  2. Thank you for dropping in. Camping trips will also be a whole new experience!

    I would not be surprised if we see other specialty coffee and retail brands trying to enter this space. A bunch of scrabbling over at P&G perhaps.

  3. Karin ... funny running into you here. Welcome. My fear is VIA will distract Starbucks from its core problems at retail.

    The company talks about how VIA will disrupt the Instant Coffee category. Fine. However, anything that distracts Starbucks from disrupting and improving its core retail business is off-strategy to me. Starbucks has MUCH bigger problems to solve than bringing innovation to the Instant Coffee category.

    While we disagree on this, it's nice to hear your marketing voice.

  4. Karin,

    That's precisely the point - "if" it doesn't distract them. They are already distracted. Starbucks continues to make the same mistake that other companies in trouble make - looking for shortcuts and trying to "extend" their way to success.

    Starbucks no longer means anything. I remember back when people would argue about Starbucks coffee (the actual coffee) or the stores (were they really sufficient as a second office). Now the only people arguing about Starbucks are marketers arguing about their strategies. Starbucks is becoming (if it hasn't already become) irrelevant.

    There is only one company that I can think of that has recovered from where Starbucks is and that's Apple. Apple had become irrelevant as well. When Steve Jobs came back to head the company the first thing he did was cut (I don't have the facts with me, but I recall that there were 22 products in development and he cut that to 4). He didn't cut for the sake of cutting or to reduce "headcount". He cut to get take the company back to its core. He then told Wall Street, employees and its fans that Apple was going to get smaller before it got bigger. And going forward they would only grow from their core. They've done that, they've become relevant and they've certainly succeeded.

    I'd like to see Starbucks do something similar - get back to the core and focus on the people that already love them.

  5. I have to agree with John and Doug about the distraction part. There have been many distractions, read "shiny new objects for Wall Street", over the years. Things like Hear Music, Akeekla and the Bee, breakfast sandwiches, lunch, etc.

    The focus should have been on reinventing the stores and the core offerings, in line with Howard's purpose for the company. It's hard not to see how this brand extension to instant isn't going to be a distraction.

    That said, I do applaud the new tea lattes. I have not been in Starbucks in a year but have been back 5 times in the past few weeks. I'm addicted : )